Luxury Buyers Drifted North, But the Tide May Be Turning

Australia’s luxury housing map has been flipped on its head over the past five years, but the pendulum may finally be swinging back toward the big cities.

According to Ray White Group Senior Data Analyst Atom Go Tian, the pandemic years reshaped where prestige buyers put their money.

“If you were speaking about luxury houses five years ago, you wouldn’t even consider markets outside of Sydney and Melbourne,” he says.

But when COVID accelerated lifestyle migration and buyers were suddenly free to look elsewhere, the country’s wealthiest house hunters proved highly mobile.

“Luxury buyers proved themselves to be the most flexible and flocked away to where luxury was still sold at a discount,” Tian says. The result: Sydney and Melbourne were largely overlooked while regional prestige markets surged.

Both major cities saw their luxury prices spike briefly in 2021 as the COVID boom lifted the entire country, but the gains evaporated almost as quickly.

Rising interest rates and the lure of discounted luxury in the regions saw Sydney and Melbourne lose roughly half their 2021 uplift the following year.

The recovery since has been patchy. Tian says Sydney “grew six per cent between 2024 and 2025 after growing just two per cent between 2023 and 2024 to finally reach a new peak luxury price of $4.5 million”.

Melbourne, meanwhile, still hasn’t clawed back its pandemic peak. Luxury prices there rose five per cent between 2024 and 2025 after falling one per cent the year prior, ending 2025 at $2.6 million.

Over five years, the two major cities have been dwarfed by the east-coast lifestyle markets that stole their thunder. Sydney grew 35 per cent and Melbourne just 17 per cent.

Compare that with Brisbane (+77 per cent), Perth (+76 per cent), Adelaide (+73 per cent), the Gold Coast (+72 per cent), and the Sunshine Coast (+68 per cent).

That surge allowed the Sunshine Coast ($2.76 million) and Gold Coast ($2.86 million) to overtake Melbourne ($2.62 million) as the second and third most expensive luxury markets in the country.

Brisbane ($2.32 million) and Perth ($2.30 million) are now only 12 per cent cheaper than Melbourne, a huge shift from 2020 when both were 43 per cent cheaper.

Many assumed this decentralised luxury map was the new normal. But Tian says the last 12 months hint at a potential reversal.

“It’s easy to assume the new normal is a decentralised luxury market, but if the last 12 months signal what’s to come, luxury buyers may just be beginning to rediscover the value of Sydney’s prestige waterfront streets and Melbourne’s leafy inner suburbs.”

The price gaps that once tempted buyers north and west have narrowed. In 2020, Sydney was twice as expensive as the Gold Coast and Sunshine Coast.

Now the gap is closer to 1.5 times. Against Brisbane and Perth, the premium has shrunk from 2.5 times to 1.9. “Sydney’s premium looks more justified than overpriced,” Tian says.

Melbourne is a more complicated story. Its long lockdowns hit confidence harder than anywhere else, sending affluent buyers to other states. But Tian believes that weakness may now be its strength.

“At only 17 per cent growth over five years, it significantly underperformed relative to its fundamentals as Australia’s second-largest city.”

If interest rate cuts arrive and confidence lifts, he says the very buyers who abandoned Sydney and Melbourne could return to find relative value they haven’t seen in years.

Leading Australian development manager Fortis has secured a landmark off-the-plan sale at Richmond Square, with high-profile hospitality entrepreneurs Bruce and Chyka Keebaugh purchasing a 550sqm penthouse residence in Carmine House, establishing a new price benchmark for apartment living in Richmond.

The purchase underscores the continued demand for premium, amenity-rich residences in Melbourne’s inner east.

The transaction marks a significant milestone for the $330 million mixed-use precinct, reinforcing buyer appetite for integrated, lifestyle-led developments.

Richmond Square comprises two residential offerings – Carmine House and Wiltshire House – alongside a 57-room boutique hotel, strata office space and a curated mix of retail and lifestyle operators.

As part of Carmine House, residents have access to hotel-style amenities and services, including concierge, housekeeping, dry cleaning and in-residence food and beverage delivery.

Best known for building The Big Group into one of Australia’s leading luxury hospitality and events businesses, the Keebaughs were drawn to the precinct’s integrated lifestyle offering and its proximity to Melbourne’s hospitality, cultural and sporting precincts, while remaining well connected to the Mornington Peninsula, where they spend much of their time.

As well, Chyka is well known to Australian audiences as one of the original stars of The Real Housewives of Melbourne, appearing across three seasons of the hit reality series.

Alongside her business ventures with Bruce, she has built a public profile as a lifestyle authority, authoring two books on home and entertaining, Chyka Home and Chyka Celebrate.

“We weren’t simply looking for a luxury apartment,: the couple said. “We were looking for a home that delivers an exceptional lifestyle every day. The combination of design, walkability, security and the broader precinct vision for the broader precinct immediately stood out.”

Jordan Winada, Head of Acquisitions (Commercial) Victoria at Fortis, said the result highlights evolving priorities at the top end of the market.

“This sale reinforces that premium buyers are prioritising the complete lifestyle experience,” says Winada.

“They’re increasingly looking beyond the apartment itself and assessing the quality of the surrounding neighbourhood as well.”

Sean Cussell, Director at Christie’s International Real Estate Victoria, who negotiated the transaction, said the result reflects the lack of comparable product at this level of the market.

“There’s simply no direct comparison for this in Richmond. It’s not just an apartment; it’s part of a fully integrated precinct combining residential, hotel, workplace and lifestyle amenity,” Cussell said.

“Buyers are increasingly assessing the broader offering, from amenity and walkability to service and convenience. Projects that deliver a complete lifestyle experience continue to outperform.”

The sale contributes to Fortis’ strong national performance, with the business recording more than $124 million in sales since March, the last three all record-breaking penthouse sales across the country, reflecting sustained momentum across its portfolio and continued appetite for premium, design-driven developments.

This follows Fortis’ recent record-breaking Ruby House penthouse sale in Sydney’s Double Bay, which set a new benchmark for apartment living in the suburb and underscores the strength of demand at the ultra-premium end of the market.

Richmond Square will announce its hospitality and lifestyle operators in the coming weeks as the project progresses towards completion this year.

Luxury Buyers Drifted North, But the Tide May Be Turning

New data shows Sydney and Melbourne underperformed during the lifestyle-migration boom, but shifting price gaps suggest prestige buyers may be circling back.

Hospitality entrepreneurs Bruce and Chyka Keebaugh have set a new price benchmark for apartment living in Richmond with their purchase of a Carmine House penthouse.